Released: 2 November 2020
October Data Shows Countries that Drive Global Growth Are Still Mired In Recession
The three key countries driving Global Growth have continued to suffer from the impact of Covid-19
The three countries that in normal times contribute over half of global growth are still collectively some way away from exiting recession. All continue to suffer from the impact of Covid-19.
China was the first into lockdown, and the draconian tactics it has employed seem to be bringing the economy back to life, without the huge secondary wave now being seen in so many countries. The October sales data look very positive. Business Confidence is returning rapidly, and a majority of panelists now believe that the next few months will be rather more inspiring than present conditions. However a full recovery is still some way away.
The USA went into lockdown significantly later than China and is still suffering dramatically from the impact of the virus. The slow reaction, and poor crisis management mean the US economy is likely to continue to shrink in comparison with the same period last year for the remainder of 2020. Unemployment remains very high and appears likely to remain so for some time.
India went into lockdown even later than the US, and is currently suffering from the virus to a far greater extent than either China or the USA. All activity related Sales Managers Indexes for India remain below the 50 "no growth" line, with Business Confidence (previously so exuberantly high in India) , and staffing indexes indicating continuing recession now into the third successive quarter.
The World Economics Global Sales Managers Index, shows the combined weighted impact of these three biggest influences on global growth. October data shows that the economies of China, the USA and India in combination, far from driving growth, remain in decline.
Perhaps most significant of all the Sales Indexes this month, the Global Market Growth Index recorded a figure still firmly below the 50 'no growth’ level, reflecting a further decline in economic activity after the falls recorded between February and August. Although the rate of decline has flattened, many of the various industrial and services markets in all three countries recorded reduced activity levels.
The key Staffing Levels Index remained some way below the 50 level also for the ninth consecutive month. This Index compares activity in October compared with the situation one year ago, and illustrates the harsh global reality of millions of lost jobs over the period since February.
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